2025 Edition

Printable Version: SOC 3104D_2025

This publication summarizes current farm trends in Iowa between 2014 and 2024, with a forecast for 2025. Indicators are taken from USDA’s Agricultural Resource Management Survey. Incomes and sales are inflation adjusted. Farms are defined as having $1,000 or more of agricultural production. Production specialty is based on the commodity with the largest production value for the farm. Reported commodities include: corn or soybeans, alone or in combination; cattle and calves, including breeding stock; hogs and pigs, including breeding stock; poultry and eggs, including broilers, layers/pullets, turkeys, and other poultry species; and dairy production in terms of milk sold.

Farms, Farmland, and Production Value

Corn is still king in Iowa. The vast majority of Iowa farms (70.4%) grow corn or soybeans on 79.5% of the state’s farmland, but corn dominates row crop production. Corn accounts for 63% of farms, 76% of farmland (641 acres per farm), and 51.6% of production value ($692,910 per farm). By contrast, soybeans have seen tough times since 2021. Operations fell from 15.8% to 7.6%, acres farmed fell from 10.5% to 3.5%, and sales/value fell from 5.3% to only 0.2% in 2025 ($76,550 down to only $2,850 per farm).

Cattle and hogs are most common livestock farms in Iowa. The cattle industry saw its presence shrink in Iowa over the past 10 years, despite recent gains in sales due to strong beef demand. The typical cattle operation has 320 acres and generates $907,280 in value per farm, the highest since 2017. Hog operations have been growing since 2021, although acres have remained relatively stable at 430 acres per farm. Production value is down 40% from 2014 and down 23% from 2024, reflecting disease outbreaks and weaker consumer demand. However, sales per farm is still very high at $1.524 million.

Dairy and poultry/eggs few in number, yet generate high sales. Iowa’s 1,600 dairy farms only account for 3% of operations, but with an average farm size of 372 acres they contribute 4% to sales statewide, averaging $1.027 million per farm. Poultry/egg farms are even more impressive, with only 630 farms generating nearly 8% of production value in Iowa, or roughly $5.288 million in sales per farm.

Net Farm Income and Farm Profitability

Net farm income is the profit or loss of the farm operation from the farmer’s labor, management, and capital after expenses. It is the difference between farm income less production expenses, plus depreciation and inventory changes. Net operating profit margin is the ability of the farm to finance ongoing operations, expressed as a percentage. It takes net farm income, adds interest expenses and subtracts unpaid operator labor, then divides this number by the value of farm production (consisting of gross cash farm income and value of inventory changes). Margins below 10% is a signal the farm is not generating enough profits to be viable long-term, meaning the business is less able to replace assets, cover unpaid expenses, expand operations, or absorb unexpected price changes.

Crop incomes and profits plummet in 2025. Corn and soybean producers posted a net farm income of only $53,580 in 2025, which is 46% lower than last year and 75% lower than five years ago. Operator net incomes for corn were higher than soybeans ($56,180 versus $32,220), but the losses were similar. Projected 2025 incomes are the lowest Iowa has seen since 2012, adjusted for inflation. As a result, profit margins fell from 12% down to 5% over the last year. Currently, corn/soybean farmers make 5.2 cents per dollar of production, the lowest margin in over a decade.

Cattle and poultry/egg incomes surge in 2025. Conversely, it was a banner year for livestock producers. Cattle incomes surged by 38% last year to $97,530, more than 250% higher than in 2021. Poultry/egg incomes jumped up 18% to a stunning $1.276 million per farm, a gain of 57% from five years ago. Hog producers saw a modest 6.7% gain that rose incomes to $293,840, but this was much lower than record pork profits in 2021. Dairy managed to slow income losses, losing only 2.5% last year. However, current net income of $237,670 is still 48% below levels from five years ago.

Money in meat and milk. Poultry/egg production is highly profitable, returning 44.7 cents in profit per dollar of production value (or a margin of 44.7%). Hog producers posted a profit of 22.5%, slightly higher than historical returns around 20%. Dairy margins did not change much last year, with returns of 15.5 cents per production dollar. After a decade of low or negative margins, cattle operations returned to minimum profitability in 2025. Cattlemen now earn 12.1 cents per dollar of production (or a 12.1% margin), up from a margin of 4.9% only a year ago.

Farm Debt

Debt repayment capacity utilization (DCRU) rates measure actual debt as a percent of the farm’s maximum feasible debt load. Values nearing 100% indicate the farm cannot take on additional debt to finance operations; and/or the farm will have difficulty paying existing debt obligations. Debt to asset ratios measure the percent of farm assets owed to creditors to cover outstanding obligations. Higher values indicate more of the farm’s assets are financed by debt instead of farmer equity. In general, ratios under 30% indicate average debt, while ratios over 50% indicate high debt loads.

Corn/soybean producers took on more debt, but secured by high-value farmland. Debt usage increased from 58.9% to 74.6% last year, as corn/soybean producers faced low prices and high input costs. However, high farmland values secured added debt, so debt to assets ratios did not change last year. In fact, debts to assets have been stable since 2021.

Livestock producer debt has stable or falling last year. Hog and poultry/egg producers paid down debt last year, with debt usage below 20% in 2025. Cattle and dairy producers did not take on any additional debt last year. Debt usage has been generally falling for both hogs and dairy, although current debt levels are about 60% today.  

Household Income for Farm Families

Crop family incomes cut in half. Families operating corn/soybean farms saw incomes sharply drop by 46% last year, to $132,070 with 53% coming from off-farm activities.

Cattle and poultry/egg family incomes surge. On a positive note, families running cattle operations saw incomes rise by 38%, to $216,810 per family. However, 73% of income still comes from off-farm work. Families in the poultry/egg industry saw incomes continue to surge over past two years. Estimated family income for 2025 is a stunning $1.098 million, with 36% from off-farm sources (mainly processing and by-products).

Families who raise hogs have seen household income rise since 2023, with a 6.7% gain last year alone. By contrast, families in the dairy industry have seen incomes fall by 36% since 2021, although the loss last year was only 2.4%.

Implications

The downturn in the farm economy in 2025 hit corn and soybeans producers hard, shrinking net farm incomes, cutting profitability, and increasing debt. This is a major concern in Iowa as 70% of our state’s farms grow these two commodities.  When corn/soybean farms fall, the state’s farm sector falls with it. This was caused by sweeping protective tariffs on nearly all goods imported into the U.S., enacted in early 2025, that increased input costs. The U.S.-China trade war reignited retaliatory tariffs and import bans, which heavily impacted row crop operations who depend on exports. Rising debt is a concern, but is secured by high farmland values.

The outlook for corn/soybean farmers in 2026 is uncertain, as tariffs remain in place and trade wars could resume. In particular, the U.S.-Iran war has not been resolved, keeping fuel and fertilizer prices high. Last year’s Farmer Bridge Assistance Program disbursed $11 billion in payments to compensate for trade war losses, but it only covered a small portion of soybean producer losses.

On a positive note, Iowa’s cattle and poultry industry had a near-record year, seeing net farm incomes surge. Strong consumer demand for beef and limited inventories buoyed cattle prices. Poultry and egg demand in the U.S. and globally is at record highs, as consumers seek affordable and high quality protein as beef has become expensive. Hog producers have seen incomes recover after a major losses in 2023 from high production costs and low domestic demand. Dairy incomes have been declining since 2021, although losses were negligible in 2025. The outlook for Iowa’s livestock sector in 2026 is positive, especially for beef, poultry/eggs, and pork. The only concerns are disease outbreaks for poultry and hogs.

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Analysis and writing by:
Dr. David Peters, Professor and Extension State Specialist: Agriculture and Rural Policy
email: dpeters@iastate.edu | tel. 515-294-6303  

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